A Southern Star Oil rig platform in Taranaki. Photo: Supplied
Analysis - For the second time in three months the whiff of panic has enveloped the country's power sector.
In May it was a case of plunging temperatures, rising demand, scarce supplies and the threat of lights out. The country got through without blackouts by the finest of margins.
And now a scarcity of gas, and a lack of wind and rain have sent wholesale power prices skyrocketing and forced big industrial users to reduce usage and cut production, in some cases even to shut up shop.
This time the world's biggest methanol maker and New Zealand's biggest gas user, Canadian based Methanex, has come to the rescue with a deal to shut its production until the end of October, and sell the gas it would have used to power generators to Contact and Genesis.
Crisis over
In the short term the gas supply deal will give the two power companies the certainty of fuel supply to allow Genesis's giant Huntly plant to run at full capacity, with the help of imported coal, while Contact will have the ability to fire up its quick start gas fired station at Stratford.
But that is only a short term fix, and goes nowhere near offering a permanent solution.
A range of other measures are under consideration, including a rule change by Transpower to allow hydro generators to draw down more water from their storage lakes.
Genesis Energy, as well as buying more gas, looks to be ramping up its imports of coal, with a dozen shipments due in the near/medium term.
Unless there is a wet and windy spring, then fossil fuels will get the system through the near term squeeze, but with the added cost of higher carbon emissions.
More power
A temporary fix for the gas supply issue would be importing liquefied natural gas (LNG), which is currently being studied by the government.
The prospect that renewed oil and gas exploration will deliver adequate supplies seems a pipe dream given the cost, distance, and the relative unattractiveness of New Zealand as a place to explore compared to other parts of the world. The gap between discovering commercial volumes of oil and gas and using them is as much as 10 years and billions of dollars.
The retort to fossil fuels is more renewable electricity - solar farms, wind farms, geothermal, but as the current predicament shows they cannot always be relied on, and power companies are reluctant to commit too early or too much to new projects until they are convinced of the commercial return.
There are still supporters for something like Labour's Lake Onslow stored hydro project, which the new government quickly killed.
Change the power market structure and rules
Associate Energy Minister Shane Jones has led the political attack on the power companies and the sector regulator, particularly the Electricity Authority, which he likened to a chocolate teapot.
The Authority has said it's not happy about the current high power prices and the fears of too little supply, so it has started a new "deep dive" to produce greater scrutiny about the sector's performance, although it's barely a year since it released a report on steps to get more competition into the wholesale electricity market.
In response to the latest market ructions the Authority said there were no quick solutions.
Other measures suggested include forcing the separation of the generation and retail operations of the big four companies. Another is reviving a decade old and abandoned idea of a state run company to buy power from the generators at the wholesale level and then sell it to retailers.
The Commerce Commission could be unleashed to look at power company pricing. It already regulates electricity, gas, and broadband distribution costs because they are largely run by companies with no competition.
The power companies are either diplomatically silent or say the government should keep out of it and the let the market decide.
But energy fretting is now becoming an all year national event.
To paraphrase Irish wit Oscar Wilde - "To have one power crisis in a year may be a misfortune, to have two looks like carelessness".